British Airways boss Willie Walsh has confirmed the airline will be forced to raise fares and cut capacity due to rising oil prices.

Walsh also said the era of the low-cost fare was over and predicted a wave of airline failures in the coming months.

However, he said BA was in good position to ride out the storm and would be investing in premium travel to help achieve that.

“Prices will have to go up given the way the oil prices are,” said Walsh.

“I don’t think the industry can absorb these significant increases. This is just the start of a correction. Those who are strong will be able to adapt but those who are weak are going to go out of business.”

When asked if the era of the low fare was over, he replied: “My view is yes.”